Market Movement from 07th Oct 2024 to 12th Oct 2024.

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• NY December, trading remained within a narrow range throughout the week. Low export sales indicated sluggish demand. In the October WASDE report, the USDA cut U.S. cotton production by 3,00,000 bales, but this was offset by lower exports and reduced mill use. Overall, the WASDE report was neutral, with only minor changes compared to the September report. As a result, December futures closed the week with a loss of 106 points.
• The October 2024 USDA-WASDE report indicates a reduction in U.S. cotton production to 14.2 million bales due to Hurricane Helene, with lower mill use at 1.8 million bales and exports down to 11.5 million. Ending stocks rise to 4.1 million bales, while the average upland farm price remains at 66 cents per pound. Globally, production increases in China, Brazil, and Argentina offset U.S. declines, but world trade decreases due to lower Chinese imports, resulting in slightly reduced global ending stocks of 76.3 million bales.
• In the latest U. S. Export Sales Report for the week ending 03-Oct2024, U.S. export sales of cotton showed a total net upland sales of 89,600 bales and upland shipments of 95,100 bales for the 2024-2025 marketing year. Additionally, net Pima sales reached 9,100 bales, with Pima shipments at 6,500 bales. This brings the total sales for 2024-2025 to 98,700 bales. For the 2025-2026 marketing year, net upland sales amounted to 13,200 bales, with no Pima sales recorded, totaling 13,200 bales for the future period.
• In India, the arrival of crops is picking up, leading to a decline in prices due to sluggish demand.
• Currently, the price of kapas (raw cotton) is near or below the Minimum Support Price (MSP). The higher seed cotton rate is offering some parity to ginners, which has pushed prices to near bottom levels. As a result, ginners are eager to sell their stock.
• This week, the Gujcot Spot Rate experienced fluctuations, starting at 56,100 on Monday before declining to 56,000 on Tuesday and reaching a low of 55,600 on Wednesday. The rate continued to decrease to 55,500 on Thursday but saw a slight recovery on Friday, closing at 55,800. On Saturday, the rate was 55,800. The overall trend reflects a week of volatility in cotton prices, with notable variations in daily rates.
• The price of Shankar-6 cotton is currently in the range of ₹55,500 to ₹55,800.
• The onset of the monsoon in the northern region was delayed so arrival was late but it is now gaining momentum. We expect to see a significant increase arrival in the coming week.
• There has been some rainfall in Central India, but it has been inconsistent and disruptive, affecting both the arrival and the quality of crops.
• Indian basis is currently around 1,200-1,400 on New York futures, making the rates close to the COTLOOK price.
• Indian mills have not yet seen strong demand, but they are now able to break even. As a result, we can expect better purchasing activity from the mills in the coming week.
• This week, the USD-INR exchange rate exhibited slight fluctuations, opening on Monday at 83.98 and maintaining stability at 83.96 on both Tuesday and Wednesday. A minor increase was observed on Thursday, with the rate rising to 83.97, before closing the week on Friday at 84.06, reflecting an overall depreciation of the Indian Rupee against the US Dollar.
• Let’s hope for the best.